Atlas Market Report - 2nd Half of 2012 for Equities -- Atlas Wealth Management, LLC

May 30, 2012 - PRLog -- PDF Link of this report (http://www.atlasbuildswealth.com/uploads/Atlas_-_June_2012_Market_Report_-_Equities.pdf)

This report is a “Value Buy List” from Atlas and is based upon a blended technique of fundamental and technical analysis. Recently, we have had a sharp pullback in the markets. Some sectors have sold off more sharply than others. We performed an analysis of several stocks and sectors that have a strong, undervalued PEG ratio(Price Earnings to Earnings Growth), less than two(2) times(x) Book Value, stocks that pays a dividend, stocks that has oversold price action and price is resting near or in a support/demand area where buyers should be coming back in. We are recommending these stocks as "short-term trades". Meaning, these trades have a 3-6 month shelf life and are due for a bounce (from the “Value Buy Range”). If you are familiar with the strategy of Writing Covered Calls, you can protect some of your downside risk and potentially increase your capital gains and overall returns by adding these. Work with a professional on this to maximize your trades if you are not familiar or comfortable Writing Covered Calls.

The "Value Buy Range" is the price range to consider entering the trade (or scale in per your strategy and portfolio diversification ratio). If price enters this range we believe this is the best value to buy the stock. Your downside should be a 2%-4% Stop/Loss depending on your Risk Tolerance and value of overall portfolio mix. The SHADED stocks are Best Picks.

Stock Price* Value Buy Range PEG** Ratio Book Value Ratio** Dividend Yield** Industry
AET (Aetna) $41.81 $38.25 - $40.25 .73 1.39 1.70% Insurance (Accident & Health)
AFL (Aflac) $40.25 $38.75 - $40.25 .71 1.36 3.37% Insurance (Accident & Health)
AIZ (Assurant) $33.46 $30.50 - $32.25 .54 .59 2.53% Insurance (Life)
APA (Apache) $84.02 $77.50 - $79.25 .72 1.06 .83% Oil & Gas Operations
AXS (Axis Capital Holdings) $33.70 $30.50 - $32.50 .79 .72 2.85% Insurance (Property & Casualty)
AYR(Aircastle) $11.50 $10.50 - $11.25 .74 .56 5.17% Rental & Leasing
CI (Cigna) $45.28 $38.75 - $41.25 .90 1.48 .09% Insurance (Accident & Health)
CVG (Convergys) $14.21 $13.25 - $14.25 .66 1.11 1.44% Computer Services
Stock Price* Value Buy Range PEG** Ratio Book Value Ratio** Dividend Yield** Industry
DFS (Discover Financial) $33.36 $30.50 - $32.25 .79 1.96 1.23% Consumer Financial
ETP (Energy Transfer Partners) $44.74 $38.25 - $41.25 .86 1.54 7.91% Natural Gas Utilities
HUM (Humana) $77.65 $71.25 - $74.25 .97 1.53 1.35% Insurance (Accident & Health)
HUN (Huntsman Corp) $13.54 $12.50 - $13.75 .69 1.63 3.11% Chemicals – Plastics/Rubber
JBL (Jabil Circuit) $20.06 $18.25 - $20.25 .74 1.95 1.69% Electronic Instruments & Controls
KMT (Kennametal) $36.20 $33.50 - $35.25 .74 1.68 1.57% Misc. Capital Goods
KRO (Kronos Worldwide) $18.01 $14.25 - $17.25 .74 1.96 3.44% Chemical Manufacturing
LINE (Linn Energy) $36.07 $35.25 - $36.75 .85 1.78 8.05% Oil & Gas Operations
MET (MetLife) $30.67 $27.50 - $30.25 .54 .55 2.44% Insurance (Life)
OXY (Occidental Petroleum) $82.89 $69.75 - $73.50 .97 1.70 2.67% Oil & Gas – Integrated
PL (Protective Life) $26.36 $24.00 - $26.50 .75 .56 2.76% Insurance (Life)
RCL (Royal Caribbean Cruises) $24.77 $22.50 - $24.50 .95 .62 1.64% Leisure
SPLS (Staples) $13.60 $12.00 - $13.75 .89 1.31 3.28% Office Supplies
Stock Price* Value Buy Range PEG** Ratio Book Value Ratio** Dividend Yield** Industry
STO (StatoiHydro) $23.30 $20.25 - $22.75 .73 1.53 4.82% Oil & Gas – Integrated
TMK (Torchmark) $46.59 $41.50 - $43.75 .97 1.22 1.29% Insurance (Life)
UBS (UBS Ag) $11.71 $10.50 - $11.50 .25 .78 .93% Investment Services
VLO (Valero Energy) $22.37 $19.25 - $22.50 .87 .77 2.69% Oil & Gas Operations
WLP (WellPoint) $68.84 $63.00 - $66.25 .91 .96 1.70% Insurance (Accident & Health)
*Last Sale Price as of May 29th, 2012
**Estimated ratio’s based on recent sale price
We believe the markets will finish higher as we get closer to the Presidential election. Once the election is over, all bets are off as we have the debt ceiling and tax cut policy issues to deal with. This will be a major issue and potentially make the volatility from the summer of 2011 look like quiet market action. We should get a nice bull run up until then as the political parties duke it out and make several business and economic promises. Pending any serious geo-political news, middle-east and more specifically the European debt issues and banking concerns, we expect to be up 5%-8% from the current S&P 500 level of 1,332 to the Presidential election. The stocks listed in this Market Report should provide some nice upside from here.
If you noticed, the Insurance sector is well represented on this list of undervalued and oversold stocks. This sector typically benefits from Bull markets and has a steady stream of recurring revenue. Energy stocks (Oil, Gas and Natural) are the second most represented sector and has been beaten up quite a bit in the 1st quarter of 2012 and barely recovered in the 2nd quarter. They are poised to bounce to the upside while some also pay a healthy dividend. Both the Insurance and Energy sector are closely correlated to the markets and can be more volatile than the overall markets. Meaning, their price action can move a greater percentage as compared to the markets (up or down).

There are different strategies to add some of these recommendations to your overall portfolio. Make sure you understand what investments are suitable for your portfolio. Your “suitability” makes a tremendous difference to your overall portfolio diversification and risk profile. Meaning, if you have a good Investment Advisor, they should have already performed a "Client Risk Profile" and a "Life Balance Sheet" for you along with an “Investment Policy Statement” that creates the framework for your portfolio mix and risk tolerance. This will help you determine how much these stocks should be a part of your diversified portfolio, how you should scale into the trade and how you should scale out. By applying Active Portfolio Management, you can actively maximize your gains. You need to have some dedicated time to watch the markets and the assets in your portfolio, if not, then discuss with a fee-based Investment Advisor.
There will be more Market Reports by Atlas over the next few months with Mutual Funds & ETF’s.
About the Author
Ronald Lang is the Principal at Atlas Wealth Management, LLC focused on working with clients to meet and exceed their financial goals through suitability and fiduciary requirements of their clients. Mr. Lang writes several articles on wealth management to educate and provide valuable information to both clients and non-clients. He believes that financial education is one of the most important skills you can have in life, but very few people pay attention to it until it’s too late. Mr. Lang also does several speaking events and volunteers his time to youth sports. You may contact him at Ron.Lang@AtlasBuildsWealth.com or (888)403-9400.

Disclosures
This report communication is for informational purposes only and none of its content shall be construed as a solicitation, recommendation or an offer to buy or sell any assets, securities or financial products. The information contained inclusive of this email has been acquired from sources believed to be credible and reliable, but Atlas Wealth Management, LLC & Co. Inc. ("Atlas Wealth Management, LLC") does not guarantee accuracy, comprehensiveness or completeness. Atlas Wealth Management, LLC and its alliances, affiliated companies, their officers, directors, contractors and employees may have a position (Long or Short) in or make a market in any securities mentioned above, and may act as an investment banker or adviser to such companies.

Also, you can download a FREE Retirement Calculator from one of these sites; http://www.NewJerseyWealthAdvisors.com, http://www.PennsylvaniaWealthAdvisors.com or http://www.ArizonaWealthAdvisors.com

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